Food and Beverage Business
Finance

US listing back on the table for Brazil’s JBS

JBS, a major player in the food and beverage industry, is seeking a stock-market listing in New York. This move will provide the meat giant with dual access to investor funds in Brazil and the US.

The company had previously completed an IPO in Sao Paulo back in 2007 and had expressed interest in a US listing through its overseas subsidiary, JBS Foods International, since 2016. However, plans were put on hold in 2017 due to a corruption scandal involving the company’s controlling shareholder, J&F Investimentos, and members of the Batista family who ran the investment firm.

Now, JBS has announced that the plans are back on, with the intention of seeking shareholder approval for a listing on the New York Stock Exchange (NYSE). An extraordinary shareholders’ meeting will be held to approve the proposal.

The CEO of JBS, Gilberto Tomazoni, highlights the value proposition this dual-listing strategy brings. He states, “Today, JBS presents a transformative value proposition to its shareholders and the market that will unlock the potential value of our global company for all stakeholders.” Tomazoni further adds that the strategy will accelerate diversification and growth into branded and value-added food products, while reducing the cost of capital and generating greater returns for shareholders.

Under the proposed plan, JBS’s Brazilian depositary receipts (BDRs) will be traded in Sau Paulo, Brazil, while class A shares will be listed on the NYSE through JBS NV, the company’s Netherlands-incorporated subsidiary.

JBS, an industry leader with a revenue of 375bn reais ($77.3bn) and the majority owner of Pilgrim’s Pride, a listed poultry supplier in the US, intends to include a dividend distribution linked to the dual listing as part of the transaction.

The CEO, Tomazoni, who assumed the role in 2018 following the Barista brothers scandal, emphasizes the company’s commitment to Brazil and its aim to create value for stakeholders. He believes their proposal will be well received by minority shareholders and the market.

According to the company’s global finance chief, Guilherme Cavalcanti, the dual listing will provide JBS with greater financial flexibility, allowing it to support growth through share issuance while reducing its cost of capital acquired via the debt markets. Cavalcanti further emphasizes that this proposal will enhance transparency, strengthen corporate governance, and attract a broader base of investors with greater financial capacity.

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